Re: [spiers] GRI
In a message dated 6/23/03 10:07:21 AM, y_mikhail@msn.com writes:
<
I 've red resently e-mail regarding export poultry meat. I have qualified
buyers in Russia. If you wouldn't mind, we can swap this information.
Best regards,
Y.Mikhail>>
This is an excellent opportunity to expand on an idea I try to put out in the
book and classes.
A wee bit back I expressed a disinclination towards trade leads... indeed, I
think in the letter welcoming people to the listserv I promise this list will
be a "no trade-lead zone."
As I mentioned earlier, trade lead lists tend to be buyers with no customers
talking to sellers with no supply. Now here we have a variation... one list
member who might help out another list member with a trade lead. What could be
more natural, or providential?
What I teach in the classes is that whether we are import or export, working
on the margin, we match the best suppliers to the best customers. I give the
steps to go through to accomplish this. I use the word margin above in two
senses; first, that since our products are new, they are not anyone's main
business activity or "marginal", second, as new products we are charging premium
prices for what we do or "wider margins".
Now, if someone on the list here in USA says "I have customers overseas for
what you sell" I see the following problems:
1. Is the country named a leading buyer of poultry? If not why not? If not,
why would a seller want to work first where there are fewer buyers, when,
time being what it is, we ought to go where the best opportunities are? Why go
to country X to sell if simple research shows country Y buys far much more? If
the country mentioned is a leading buyer of the product, then the shortcut of
a trade lead tip leaves out all the wealth of information that normal research
would provide.
2. Are the buyers overseas first rate distributors in their own country? If
so, why would they work through intermediaries, and use the normal processes,
as I have lain out, for finding suppliers? If not, why would we want to spend
time working with them, when we can easily fiind better prospects? (And of
course, if they are not first rate, why would we want to work with them?)
The money is where we can provide a value. When an established company
overseas (first rate has nothing to do with size) is looking to build market in
USA, and finds a start-up company with proven demand such as us, then there is a
value we can provide.
Or, when a company overseas is looking to tap into first rate USA production,
but cannot get its products to export specifications without the help of
small businesses like ours, then we can provide a value.
This is a hard point to make, and probably to understand, and I am happy to
debate it with a view to nuancing the argument further.
John
Monday, June 23, 2003
GRI
Credit Card or Letter of Credit, pros and cons
In a message dated 6/20/03 7:49:59 PM Eastern Daylight Time, wileyccc@aol.com
writes:
> I am sure in retrospect part of my displeasure with credit card int'l
> payments had to do with the fact that I had invested so much time and effort
in
> learning about letters of credit. If credit cards become common in int'l
> trade, then all I know about that topic is obsolete. I hate it when that
happen!
I understand. I had a 3-credit law school course (one semester) on letters of
credit.
I have a great deal of experience with letters of credit (L/C), and I don't
foresee their demise in my lifetime. (I'm currently 44 and all four of my
grandparents passed away at 90+.) L/Cs certainly will never become obsolete for
large transactions. A confirmed L/C assures the seller that the he will be paid
when he satisfies the terms of the letter of credit. L/C terms should be
negotiated between buyer and seller, and it is in everybody's (seller, buyer,
L/C
issuer) best interest that the L/C terms be totally objective so that disputes
do not arise. When terms are totally objective, the institution that issued
the L/C (e.g., bank) pays the seller when the seller presents the
documentation that fulfills the L/C terms. Objective documentation can include
airway
bill, shipment inventory confirmation issued by independent third party,
incoming
customs documentation, and the like. If you are selling, documentation that
can delay your being paid is documentation over which the buyer has control,
regardless of whether the buyer or its agent actually produces the
documentation, e.g., testing certificate signed by buyer, shipment inventory
confirmation
signed by buyer, et cetera. In an ideal L/C, the seller is in complete
control, and the buyer has no control, of when the seller is paid.
For the seller, the best part of the confirmed L/C is that being paid is
completely independent of the satisfaction, mood, whim and fancy of the buyer.
After all, the buyer does not pay the seller, the institution that issued the
L/C pays the seller. To achieve this goal, remember to negotiate L/C terms that
are objective and independent of buyer behavior. Even if the buyer is
scrupulous in A/P, situations can occur that delay payment to sellers (e.g.,
war,
natural disaster, epidemic, loss of key personnel). In addition, buyers have
been known to dispute credit card charges solely because the buyer is unable to
pay the credit card bill, not because the seller has done something wrong.
Even if the seller has perfectly executed the terms and conditions of the
contract, under certain circumstances a buyer may fail to produce L/C-required
documentation. For example, if the buyer miscalculated cash flow and is short
on
funds, or if the buyer wants some leverage over the seller (because of warranty
issues, negotiation of next purchase, et cetera), the seller may not timely
receive that L/C-required documentation over which the buyer has some control.
To benefit the buyer, the L/C can be issued for very little money, the L/C
may not have to be drawn down, and bank loan rates are generally far lower than
credit card interest rates. The bank takes care of all the work involved in
paying the seller, so that the buyer can invest time and effort in other tasks.
Finally, an L/C can act like a reference for a buyer, and there are
situations when a buyer needs that reference. If the buyer is a relatively new
concern and does not have A/P history, or if the buyer has seen hard times and
its
A/P reputation isn't what it used to be (e.g., WorldCom, Enron), by posting an
L/C the buyer can obtain inventory or other goods and services it requires to
earn revenue.
Under certain situations, a seller may never have to draw on the L/C. I have
negotiated many contracts in which the payment terms are (1) the buyer posts
the L/C, (2) the seller fulfills the contract, (3) the seller invoices the
buyer, (4) the buyer pays the seller in accordance with the contract terms, BUT
if the buyer does not so pay the seller can then draw down on the L/C to obtain
payment. In this kind of scenario, the buyer (generally) pays only for the
establishment of the L/C, however I have represented sellers who paid the fee
for establishing the L/C because the cost was minimal, the benefits of having a
confirmed L/C were far greater than those minimal costs, and the seller built
into its price (as part of its G&A) the cost of the L/C.
To quote one of my professors, "Clear as mud?"
Best wishes,
Celeste
Whew! Hope all of you are well,
Celeste
Accepting Credit Cards
RE: [spiers] Accepting credit cards
I use Costco, but I think the $20 per month minimum is high. Other than that,
it works fine.
-----Original Message-----
From: Linda Lu [mailto:lindakclu@yahoo.com]
Sent: Thursday, June 19, 2003 10:25 PM
To: spiers@yahoogroups.com
Subject: [spiers] Accepting credit cards
Hi all,
Any advice on how to get started on accepting credit
card payments?
My partner and I are comparing services provided by
Costco and banks. Will appreciate any pointers,
recommendation, or which one not to go for kind of
advices.
Thanks,
Linda
Sunday, June 22, 2003
GRI
Re: [spiers] GRI
Hi, everyone
I 've red resently e-mail regarding export poultry meat. I have qualified
buyers in Russia. If you wouldn't mind, we can swap this information.
Best regards,
Y.Mikhail
----- Original Message -----
From: "srintra saisarai"
To:
Sent: Monday, June 09, 2003 11:32 AM
Subject: [spiers] GRI
> Hi
>
> I work in export poultry. Recently, I try to find good freight rate for
east coast shipment. All carriers mention that the rate subject to GRI
$1000 on July 1st. I just would like to know what is GRI?
>
> I'll be appreciated your response.
> noonoi
Accepting Credit Cards
Re: [spiers] Accepting credit cards
$49.00 a month, I should think, is a web site hosting fee.
***Yes, then you can sign up for “revenue sharing” if they drive customers to
you..and many other services...***
You'll be
paying a lot more than that in the fee called a "merchant discount fee"
(misnomers are alive and well) that Yahoo will charge you for processing
your credit card payments. :0
I've seen merchant discount fees - both at brick-and-mortar banks and on the
net - from 1.25% to 5.00%. That would be 5% of your revenue paid by credit
card. ... Here's a tip from the "live and learn" department. Don't ever
allow a third
party to hold that kind of power over your cash flow. Depending on the type
and size of your business, it could kill you.
***Yes, I completely forgot that yahoo.com also offers the merchant account
option as well... for exactly the reasons Dave outlines, I would not let them
handle the merchant account, thus I went with Wells Fargo. So see an eCommerce
site as two parts: the cayalog and order form function; and then the payment
processing function. You’ll need both parts.***
Lastly, I wouldn't worry about accepting credit cards until your underway.
You don't need them to get started. I wouldn't be concerned with it until
you are asked several times if you accept credit cards. Then go obtain the
ability.
*** Dave is right again... you can start a Yahoo.com store just accepting
checks, money orders and paypal... and complete avoid the credit cards. Just
wait until the check arrives in the mail, deposit it and ship the goods. I
recall I did that too. It is a good strategy. Now this was back in 98 or 99...
but I recall being surprised that when it came time to get a credit card
merchant account it was surprisingly expensive and tedious. Nobody was in any
hurry to have the exposure of the web I guess. (In 1979 you could just walk in a
bank sign a form and walk out with a complete merchant account system in a box,
no credit checks, no nothin’!).***
John